I have few queries: 1) Q13: BcS scenarios, If we have sold 7 option to buy 100 shares(each) in 1 month tim at 1100 and prices go up to 1150, it will be buyer (long position) of option who is likely to not exercise the option as he can sold them at high prices to somone else. WHY do he have to pay additional premium? . 2) Q14: what are they trying to ask? Its a pvt ltd company, how can they issue debentures and warants(it is stock exchange traded) 3) Q16: if we consider tax benefit of other expenses at t=0 rather than 1.. woukd it be wrong? . Please reply asap!
Q16 it won't be wrong. They have also mentioned it in the solution that some students will take 1.25 tax savings in year 0 and 18.75 in year 1.
